Avast to acquire AVG for $1.3 billion

Avast announced an agreement to acquire security rival AVG for $1.3 billion and $25 per outstanding share in an all cash offer earlier today.

AVG's stock jumped up more than $6 today already to $24.80 after the announcement was released by both companies.

The company reported gross income of $363.81 million and a net income of $46.97 million in 2015.

The transaction has been approved by AVG's and Avast's management board and supervisory board already, and AVG's board recommended the acceptance of the offer to AVG Shareholders.

While it is still possible that shareholders will deny the deal, it seems unlikely that this is going to happen considering the premium that Avast is willing to pay.

Both AVG and Avast control a sizeable share of the security market, and the acquisition will surely strengthen Avast's position in the market.

It is unclear at the time of writing if changes will be made to AVG's product lineup. It is for instance possible that Avast will retire some or even all of AVG's products in the coming years. It could implement core technology used by AVG into its own products before that happens.

Another possibility is that AVG will remain a brand with its own products under the Avast banner.

According to the press release, software of both companies is installed on more than 400 million devices, of which 160 million are mobile.

Combining Avast’s and AVG’s users, the organization will have a network of more than 400 million endpoints, of which 160 million are mobile, that act as de facto sensors, providing information about malware to help detect and neutralize new threats as soon as they appear. This increase in scale will enable Avast to create more technically advanced personal security and privacy products.

Avast's motiviation behind the deal is to "gain scale, technological depth and geographical breadth" to take advantage of "emerging growth opportunities in Internet Security as well as organizational efficiencies".

The deal will help Avast "serve customers with more advanced security offerings in the core business and new innovations in emerging markets, such as security for IoT devices".

Closing Words

It is too early to tell what the future will hold for AVG products and the new organization that emerges from the deal. At best, this could lead to improvements in detection rates, performance, and speed in which protections are integrated into company products.

It is likely that nothing will change in the next six to twelve month period after the deal is closed. After that, it is anyone's guess what will happen.

Now You: What is your take on the deal?

Summary

Article Name

Avast to acquire AVG for $1.3 billion

Description

Avast announced an agreement to acquire security rival AVG for $1.3 billion and $25 per outstanding share in an all cash offer earlier today.

Author

Martin Brinkmann

Publisher

Ghacks Technology News

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About Martin Brinkmann

Martin Brinkmann is a journalist from Germany who founded Ghacks Technology News Back in 2005. He is passionate about all things tech and knows the Internet and computers like the back of his hand.You can follow Martin on Facebook, Twitter or Google+

Between the fact that companies like this generally don’t acquire their major competition unless it’s specifically to kill off that competition and the wording of their announcement, I think it’s fair to assume that if you are a fan of AVG products you should probably start shopping for a new company to get behind now.

AVG products will either be outright discontinued (unlikely) or will simply stop receiving any sort of substantive updates till enough of that customer base migrates to Avast products or leaves to warrant closing shop on AVG.

1.3B. I tend to use AVAST but after this i wont renew. AVG is a horrible AV not sure how it remains in business and manages to make a deal worth this much. Well time to find another AV maybe Norton LOL J/K.

I use to use AVAST until I GOT TIRED of all that Bloatware that would come with each installation (it was a Fine product back in the day)! I never LIKED AVG – – dropped its use years ago (especially that ineffective toolbar – – Yikes)! Too bad for AVAST!

I tried to use Avira which is a good product but always had trouble with their updates – – it wouldn’t for some reason.

Now I use Sophos’ FREE anti-malware system for home use (the same engine used for business enterprise) . . . basically, one can set it and forget! Love it! It can be found here: https://home.sophos.com/reg

I took the same path as you. AVG quickly became a monster. AVAST took its time getting there, but now (it’s still installed on my old XP machine) it is more annoying than useful, and growing in size by leaps and bounds. I loved AVIRA for about a month, but like you, I couldn’t get it to update. Weird, huh?

Thanks for the Sophos link. Maybe I’ll try that. Right now I’m unprotected.

I would not use Sophos. check the latest av-comparitives. Sophos performs very poorly, not much better than Microsoft. I personally use business.avast.com to protect about 100 pc and a couple servers for free. Avast is very light and does good job of basics: email, files, web. Av-comparitives not best but good enough for Avast. I use ESET at home but will probably switch to Bit-Defender or Trend Micro who are at the top consistently. Bit-Defender has less false positives and that would make it top.

As far as going for free, business or home Avast, or Avira. I use Avira on my test virtual machines at home and does pretty well. Webroot is worth a mention to – very light and very high detection – very good but I don’t think they do a free version.

But Sophos ? No, they need to improve a lot. A company I do IT support for use Sophos enterprise product and virus and malware get past all the time. I have now removed everyone’s local admin rights until I convince them to get something else..(a tall order for me since they have 15,000 PC’s….)

I predict one product under two brand names, like Bullzip and BioPDF (they’re the same thing). This way Avast doubles the size of their customer base while simultaneously halving development costs of the larger firm (after half the staff are fired). Profit.

That’s the most likely outcome IMO. Plus it allows Avast to perpetuate the illusion that it has serious competition in the form of AVG. A significant number of Avast’s potential customers will compare price and features with AVG, not realizing it’s the same business.

I see nothing good coming from this. The AVG staff will be cut and those products “integrated” into Avast’s existing catalog with any duplicate products getting the axe. With less competition comes less consumer choice too. Pretty much everyone loses except the AVG execs.

I was a long time user of Avast until the version that upgraded you to the cloud. I updated to the new version, but Avast just refused to remember ANY changed settings and flagged me that I had no protection. I could never get it to protect my computer again. (Avast Showed it was activated OK). Avast also Installed Google Chrome with no choice of opt out. The data updates were now taking about half a day to install instead of just minutes with the old version. I did an Computer Image Restore and the previous version of Avast was working correctly again. So…I removed Avast from my computers and installed another antivirus program. I tried AVG again. I had tried it in the past and the new version still tried to take over. Avast and AVG can do anything they like. I will never use either again.

About gHacks

Ghacks is a technology news blog that was founded in 2005 by Martin Brinkmann. It has since then become one of the most popular tech news sites on the Internet with five authors and regular contributions from freelance writers.